Recently the Reserve Bank of India has introduced the digital rupee as the official central bank digital currency of India. This decision has been taken by the Reserve Bank of India keeping in mind the future of India.
Today we will tell you about the digital rupee and what are its benefits and how it can be used, so that it will help you in using the digital rupee.
What is the Digital Rupee (e₹)?
Digital Rupee is a digital version of India’s cash currency which is designed to complement the cash currency and provide a secure and cashless means. This currency works on e₹ blockchain technology which provides transparency.
- This currency is fully backed by the Government of India.
- The user can transact through a mobile app.
- It is mainly designed to digitize the cash currency.
How to Get Started with Digital Rupee (e₹)?
First you need to download the digital rupee application provided by your bank.
Then you need to sign up using your mobile number linked to the bank where your account is registered.
You can then load the digital rupee into your wallet using your bank account and your currency will be stored in digital form.
This application has the signature of the Governor of the Reserve Bank of India just like the cash currency and has notes of denominations ranging from 50 paise to Rs 500.
How to Use Digital Rupee for Payments?
Making Online Payments
To make a payment, first open your digital wallet app and you can transact using wallet ID or QR code.
Person-to-Person (P2P) Transfer
You can send e-₹ directly to any person by entering their wallet ID without the need of any intermediary.
Offline Transactions (Future Feature)
RBI is working on making this digital wallet app usable without the need of internet in the future.
Benefits of Using the Digital Rupee (e₹)
Fast and Secure Transactions
No third party app or bank is required during the transaction which provides better security.
No Dependency on Bank during Transaction
While using UPI, it is mandatory to link you to a bank, whereas with this digital wallet, you do not need to link any bank during the transaction, you can store and use your money in this wallet.
There is less Dependency on Money
It is a digital currency, so the need to keep cash will be eliminated, which reduces the risk of theft.
Government Backed and Legal
It is different from cryptocurrency which is recognized by the government which ensures trust and stability.
Digital Rupee vs. UPI vs. Cryptocurrency
| Feature | Digital Rupee (e₹) | UPI | Cryptocurrency |
|---|---|---|---|
| Issuer | RBI | Banks & NPCI | Decentralized |
| Legal Status | Fully Legal | Fully Legal | Unregulated |
| Internet Requirement | No (Offline mode available) | Yes | Yes |
| Security | High | High | Varies (Can be volatile) |
| Transaction Cost | Zero | Low | High (Gas Fees) |
| Use Case | Digital Cash | Bank Transfers | Investment, Trading |
Is Digital Rupee Safe?
Yes! Digital Rupee is safe which is based on high security and backed by RBI and Government, however, user should be careful of fraud and scams just like UPI or Net Banking.
Security Tips:
Never share your wallet password with anyone.
User should use only official bank app and avoid using any third-party application.
Always keep wallet locked and never share OTP with anyone.
User should avoid any fake calls claiming free e₹ offer.
Conclusion
Digital Rupee is a decision taken by India keeping the future in mind or rather say it is a big step towards cashless economy of India which provides secure transactions whose main aim is to reduce the need for cash. As the Indian economy grows, the responsibility on the government and RBI will increase as to how to make the transactions secure.
To what extent do you agree with this decision of the government and RBI, please share your views with us or if you need more information please let us know in the comment.
To know my views on other issues Visit Here.
